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Dimple

Student

364 Points Joined October 2009

If in the question of fund flow statement, debenture amount is given on two dates in balance sheet, difference between the two, will be taken as redeemed debentures or will be calculated on opening balance of debentures??

Replies (24)

Guest

If the opening balance of Debenture is more than its closing balance, treat the difference as redemption of debenture and show it as application in fund flow.

If the closing balance of debenture is more than its opening balance, treat the difference as fresh issue of debenture and show it as sources in fund flow.

Hope you have understood..

mukesh kumar

ca cpt

21 Points Joined May 2010

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Guest

if cl bal of debn. is more than op. then treat it as reddmption of debn or if cl. is more than op. then treat it as fresh issue

Guest

Originally posted by : Rohit Kapoor
	if cl bal of debn. is more than op. then treat it as reddmption of debn or if cl. is more than op. then treat it as fresh issue

You are confusing yourself. How can it be redemption when ur closing bal. is more? Also you have contradicted your own statement by saying if cl is more than op. treat as fresh issue. I think you are confused.

Guest

hey faiz...we are not here to pull each others leg...and if u have common sense ...so u can very well understand what I meant to say , It is by mistake...

Guest

if op bal of debn is more than cl...then take it as redemption....

Guest

Dear Rohit,

I am not pulling your leg. I have just corrected your statement and i just told that you are confused... I meant, you might have posted by mistake only, which i corrected.

I don't know why you took so seriously. Anyway sorry if you are hurted. Take it in a professional attitude. Hope i have not abused you that you took so seriously.

Sorry ... All the best...

Guest

yaah...I know u were makin me correct ...bt I dont like the way u are.....understand...

Dimple

Student

364 Points Joined October 2009

Hey Guys!! Its all right yar...

And, this thing i know.

I was asking that if in the question, it is given that redeemed 30% of the debentures @ Rs 103

then, this 30% will be calculated on opening balance of debentures or on closing balance??

Guest

obviously yaar...on op. bal. ....bcoz after that u get to know abt cl. bal.

Dimple

Student

364 Points Joined October 2009

That only I did but my answer was not matching, I will do that question again, then, I will tell about the problem..

Thanks for reply...

Also tell me that if in additional info. it is given that it is decided to value stock at cost where as previously the practice was to value stock at cost less 10%. The stock according to books on 31.12.2008 was Rs 54000. The stock on 31.12.2009 was correctly valued at cost Rs 75000.00 What will be the treatment for this???

Thanks in Advance

Guest

it means op bal is 90 percent so., 54000*100/90 to get the correct op. fig. ..it is 60000 and diff is credited to FFO...

Guest

which is 6000 there is no further treatment of this 6000....and u can mail me question at rohitkapoor1990 @ gmail.com....I will give u complete sol.....

Guest

@ Dimple

Regarding debenture doubt---

Suppose op bal of deb. is 200000 and cl. bal of deb. 100000. It means there is redemption of Rs 100000 of debenture.As per your doubt u said 30% of debentures is redeemed at 103. So on Rs100000 debentures redeemed you calculate premium on redemption @ Rs 3 or 3% which will be Rs 900/=

Moreover, debentures are shown at face value in balance sheet. If co. decides to show premium on redemption, it will be shown seperately and will not be clubbed with Debentures.

In fund flow statement you show 100900 as application .

In adjusted P&l A/c you debit premium on redemption of deb. by Rs900/=.

The value taken by me is imaginary. you take values as per your sum.

Hope you have understood..